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Ukraine Crisis: European gas prices hit record high; Boeing, Apple & Exxon cut business ties with Russia

Members of the Ukrainian community hug during a protest outside of the Russian embassy in Buenos Aires, on March 1 (AP)
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Updated 03 March 2022
Arab News
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Ukraine Crisis: European gas prices hit record high; Boeing, Apple & Exxon cut business ties with Russia

Updated 03 March 2022
Arab News

RIYADH: European gas prices hit record highs: oil prices on both sides of the Atlantic are at their highest since 2014; while US businesses such as Boeing and Apple are taking measures against Russia.

Highlights:

  • China refuses to impose financial sanctions on Russia.
  • Shares in Russian aluminum giant Rusal plunged 26 percent on Wednesday after the world’s largest commodity trader said it would review its business ties in Russia while condemning the country’s invasion of Ukraine.
  • Dubai’s Mashreqbank has halted lending to Russian banks due to heightened risk from the Russia-Ukraine war.. 
  • Russia's central bank kept stock market trading on the Moscow Exchange suspended for a third day in a row on Wednesday, but said it would allow a limited range of operations for the first time this week
  • European gas prices surged Wednesday to a new record high on concern about supplies from Russia in the wake of its invasion of Ukraine.
  • The price of US oil - West Texas Intermediate crude has also spiked up to $109 a barrel.
  • Rise in oil prices came just a few hours after the International Energy Agency's members decided to release 60 million barrels of oil from emergency stockpiles.
  • South Korea has also joined the list of western countries imposing bans on Russian banks, including Sberbank, VEB, PSB, VTB, Otkritie, Sovcom, and Novikom. 
  • Apple Inc halted its product sales in Russia, Bloomberg said.
  • American aviation giant Boeing has decided to suspend all support for Russian airlines and its operations in Moscow, according to an FT report.
  • Siemens Energy AG is stopping all businesses in Russia, according to a Reuters report. 

Oil majors depart

Exxon Mobil on Tuesday became the latest oil major to exit Russia oil and gas operations that it has valued at more than $4 billion and halt new investment as a result of Moscow’s invasion of Ukraine.

The decision will see Exxon pull out of managing large oil and gas production facilities on Sakhalin Island in Russia’s Far East, and puts the fate of a proposed multi-billion dollar liquefied natural gas facility there in doubt. 

 It joins Shell and BP who have dropped all Russian ventures, while TotalEnergies has decided not to invest in new Russian projects.

 

Pressure on Eurozone mounts

The euro has plunged to its weakest since March 2020. The latest updates suggest that the common European currency fell half a percent to as low as $1.1069, according to a Reuters report.

However, the dollar is going strong, with the index 0.4 percent to 97.755.

Russia's Ruble is still facing the heat at 108 per dollar, having fallen as low as 120 earlier in the week. Eurostat, the statistical office of the EU, reported eurozone inflation hitting a record annual high of 5.8 percent in February since records began in 1997.

China refuses to join in sanctions

China won’t join the United States and European governments in imposing financial sanctions on Russia, the country’s bank regulator said Wednesday.

China is a major buyer of Russian oil and gas and the only major government that has refrained from criticizing Moscow’s attack on Ukraine.

Beijing opposes the sanctions, said Guo Shuqing, the chairman of the China Banking and Insurance Regulatory Commission.

“We will not join such sanctions, and we will keep normal economic, trade and financial exchanges with all the relevant parties,” Guo said at a news conference.

“We disapprove of the financial sanctions, particularly those launched unilaterally, because they don’t have much legal basis and will not have good effects.”

US businesses

As Russia stages large military onslaught on Ukraine, several US-based businesses are cutting ties with the European giant, in an attempt to show solidarity with war victims.

Google and Meta have restricted or withdrawn services in Russia since the invasion of Ukraine.

Since then, several top American companies partially or completely halted their business operations in Russia.

Apple Inc., the manufacturer of the iPhone, has halted its product sales in Russia.

The American tech giant has also removed RT News and Sputnik News applications from App Stores outside Russia.

FedEx and UPS, two of the largest shipping companies in the world have now stopped shipping to Russia.

These companies  have also announced the suspension of both inbound and outbound packages in Ukraine citing security reasons.

The aviation industry is also strongly responding to Russia's ongoing invasion of Ukraine.

Delta Air Lines, one of the largest US carriers, has suspended its "codeshare services" with Russia's Aeroflot. 

Boeing announced on Mar. 1 the suspension of all support for Russian airlines and its operations in Moscow.

Government funds

The British Columbia Investment Management Corp is actively working to sell Russian securities after Russia's invasion of Ukraine, the Canadian province's public sector pension fund said on Tuesday.

"BCI has not only been working to sell the Russian shares in our clients' portfolios but also to have Russia removed from all global and emerging market indices," Chief Executive Gordon Fyfe said in a statement.

Banking

ING Groep NV, the largest Dutch bank, has announced it will not do any new business with Russian companies.

The firm has wholesale banking offices in both Russia and Ukraine, with 400 Russian employees and 110 Ukraine employees.

The bank said it remained in close contact with employees in both countries.

Out of ING's 600 billion euro ($666 billion) loanbook, around 4.5 billion euros is outstanding with Russian clients and 600 million euros with Ukrainian clients.

"We strongly condemn the invasion of Ukraine, the devastating and heartbreaking impact it has on people’s lives and the threat it poses to international stability and security,” said Steven van Rijswijk, CEO of ING Group in a statement.

The bank said that in addition to halting new business with Russian companies, it would waive transaction fees for retail transactions to Ukraine.

It said it is complying with international sanctions. 

Russian oil, gas to Britain

Russia can still send oil and gas to Britain despite a ban on the country’s ships visiting British ports, the Department for Transport said on Wednesday.

Britain on Tuesday passed a law that it said banned all ships that have any connection to Russia from entering its ports. It applied to all ships that are Russian owned, operated, controlled, chartered, registered or flagged, Reuters reported.

However, the transport department said the sanctions were focused on the vessel, not its cargo, and so would not stop ships registered with other countries from transporting Russian oil or liquefied natural gas to Britain.

G7 looks to stop cryptoassets 

The Group of Seven industrialized nations are examining ways to stop individuals or companies targeted by Western sanctions over Russia’s invasion of Ukraine using cryptocurrencies to dodge the punitive measures, Germany’s finance minister said on Wednesday.

“We should take measures to prevent listed persons and institutions from switching to unregulated cryptoassets. We are working towards this in the context of the German presidency of the G7,” said Christian Lindner.

Cryptocurrency purchases in rubles have climbed to a record high since the US and Western allies have sought to cripple Russia’s banking sector and currency with a barrage of sanctions over last week’s invasion.

They include cutting selected Russian banks from the SWIFT messaging system, rendering them isolated from the rest of the world.

Topics: Boeing Apple Gas Prices INGs

Saudi Arabia to welcome Middle East’s first TRIBE hotel in King Salman Park

Updated 23 December 2024
Nirmal Narayanan
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Saudi Arabia to welcome Middle East’s first TRIBE hotel in King Salman Park

  • TRIBE Riyadh King Salman Park hotel will feature two restaurants, meeting facilities, banquet hall, gym, and swimming pool
  • TRIBE Living will introduce 150 apartments ranging from studios to three-bedroom units
Updated 23 December 2024
Nirmal Narayanan

RIYADH: French hospitality group Accor and Naif Alrajhi Investment have signed an agreement to bring the Middle East’s first TRIBE hotel to Saudi Arabia. 

The project, featuring a 250-key property, will be situated within Riyadh’s King Salman Park and will include the debut of TRIBE Living, a new residential community concept. 

The collaboration builds on the partnership between the two entities, which successfully launched Fairmont Ramla Serviced Residences last year, according to a press release. 

This initiative aligns with Saudi Arabia’s Vision 2030, which aims to diversify the economy and boost the tourism sector, targeting 150 million annual visitors by 2030. 

“The introduction of TRIBE and TRIBE Living to Saudi Arabia showcases our focus on design-led, lifestyle experiences that meet the growing demand for modern, accessible hotel offerings in Riyadh,” said Duncan O’Rourke, Accor’s CEO for premium, midscale and economy brands for Middle East, Africa and Asia Pacific. 

The TRIBE Riyadh King Salman Park hotel will also feature two restaurants, meeting facilities, a banquet hall, a gym, and a swimming pool. 

TRIBE Living will introduce 150 apartments ranging from studios to three-bedroom units, offering residents access to the hotel’s dining and recreational amenities, the release added. 

Since its launch in 2017, the TRIBE brand has grown to 18 hotels with 2,708 rooms globally. 

Riyadh is emerging as a global hub for business and leisure, fueled by growing demand for premium accommodations. Accor aims to capitalize on this trend with 1,683 operational keys in the city and 2,740 in the pipeline. 

The announcement follows the King Salman Park Foundation’s plan to develop its first real estate investment plot in collaboration with Naif Alrajhi Investment. 

“We are delighted to be working with Accor once again, a trusted partner, to introduce new and iconic brands to the local market for the first time. This partnership is a significant step forward in our ongoing commitment to delivering world-class destinations that cater to both local and international audiences,” Naif Saleh Al-Rajhi, chairman and CEO of Naif Alrajhi Investment. 

The project is part of King Salman Park’s Package 1, a 290,000-sq.-meter mixed-use development featuring residential, commercial, retail, and recreational spaces. The district is strategically located near the park’s key attractions, such as the Royal Arts Complex and Visitors Pavilion. 

Accor is planning substantial growth in the Kingdom, with 45 new establishments and 9,800 keys expected by 2030, O’Rourke told Arab News in May. 

Saudi Arabia’s hospitality sector has gained momentum, driven by large-scale events such as Riyadh Season and AlUla Season. 

A report by JLL released earlier this month highlighted that urban infrastructure development is creating new opportunities in the Kingdom, driven by the government’s push for economic diversification and increased tourism.

Topics: Accor TRIBE hotels Saudi hotels

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Closing Bell: Saudi main index closes in green, reaches 11,949 points

Updated 23 December 2024
NOUR EL-SHAERI   
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Closing Bell: Saudi main index closes in green, reaches 11,949 points

  • MSCI Tadawul Index increased by 15.52 points, or 1.05%, to close at 1,500.07
  • Parallel market Nomu lost 285.18 points, or 0.91%, to close at 30,953.11 points
Updated 23 December 2024
NOUR EL-SHAERI   

RIYADH: Saudi Arabia’s Tadawul All Share Index increased by 0.84 percent or 99.42 points to reach 11,948.79 points on Monday. 

The total trading turnover of the benchmark index was SR4.9 billion ($1.3 billion), as 111 of the listed stocks advanced, while 117 retreated. 

The MSCI Tadawul Index also increased by 15.52 points, or 1.05 percent, to close at 1,500.07. 

The Kingdom’s parallel market Nomu dropped, losing 285.18 points, or 0.91 percent, to close at 30,953.11 points. This comes as 32 of the listed stocks advanced while 51 retreated. 

The main index’s top performer, Zamil Industrial Investment Co., saw a 4.31 percent increase in its share price to close at SR33.90. 

Other top performers included Saudi Reinsurance Co., which saw a 4.20 percent increase to reach SR47.15, while the Mediterranean and Gulf Insurance and Reinsurance Co.’s share price rose by 4.16 percent to SR23.52. 

Red Sea International Co. also recorded a positive trajectory, with share prices rising 3.89 percent to reach SR56.10. 

Kingdom Holding Co. also witnessed positive gains, with 3.75 percent reaching SR9.13. 

National Co. for Learning and Education was TASI’s worst performer, with the firm’s share price dropping by 3.94 percent to SR204.60. 

Aldrees Petroleum and Transport Services Co. followed with a 3.84 percent drop to SR120.20. Riyadh Cement Co. also saw a notable drop of 3.61 percent to settle at SR32.05. 

Walaa Cooperative Insurance Co. and MBC Group Co. were among the top five poorest performers, with shares declining by 3.52 percent to settle at SR17.56 and by 3.17 percent to sit at SR54.90, respectively. 

On the announcement’s front, Almujtama Alraida Medical Co. disclosed that Khabeer Althanyia Investment Co. — a major shareholder — has announced its intention to distribute and deposit its 630,673 shares in Almujtama Alraida, representing 6.64 percent of the company’s capital, into the investment portfolios of its current partners. 

The move, according to a filing on Tadawul, will result in changes to the list of the company’s major shareholders. 

Almujtama Alraida Medical Co.’s share price dropped 2.91 percent on Monday to settle at SR30.05. 

Najran Cement Co. announced that its shareholders approved the transfer of SR163.62 million from its statutory reserve, as reported in its financial statements for the year ending Dec. 31, 2023, to its retained earnings balance of SR138.15 million. 

The decision was made during the company’s extraordinary general meeting held on Dec. 22, according to a statement on Tadawul. 

Shareholders also approved the repurchase of up to 17 million shares to be held as treasury shares, citing the board’s view that the company’s stock is trading below its fair value. 

The share buyback will be financed through the firm’s resources, including cash balances or credit facilities, with the board authorized to complete the process within 12 months of the meeting date. 

The repurchased shares can be retained for a maximum of 10 years, after which the company will comply with applicable laws and regulations, the statement said. 

Najran Cement Co.’s share price saw a 1.22 percent dip on Monday to close at SR8.92.

Topics: Saudi Arabia Tadawul All Share Index (TASI) Closing Bell MSCI Tadawul Index NOMU Tadawul TASI Saudi stock market Saudi Stock Exchange (Tadawul)

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Saudi Arabia inaugurates Yanbu Grain Terminal to boost food security, trade

Updated 23 December 2024
Nadin Hassan
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Saudi Arabia inaugurates Yanbu Grain Terminal to boost food security, trade

  • Yanbu Grain Handling Terminal will serve public and private sector importers
  • It boasts a storage capacity of 156,000 tonnes, including 12 silos with a combined capacity of 96,000 tonnes
Updated 23 December 2024
Nadin Hassan

RIYADH: Saudi Arabia has inaugurated the Yanbu Grain Handling Terminal, underscoring the Kingdom’s efforts to strengthen public-private partnerships, enhance agricultural trade, and bolster food security across the region.

The event was attended by Abdulrahman Al-Fadli, minister of environment, water and agriculture, and by various government and private sector officials, according to the Saudi Press Agency.

The Yanbu Grain Handling Terminal will serve public and private sector importers, and boasts a storage capacity of 156,000 tonnes, including 12 silos with a combined capacity of 96,000 tonnes.

Food security has risen up the agenda in recent years, as countries in the Gulf contend with the impacts of climate change, the consequences of trade-disrupting conflicts such as the Ukraine-Russia war, and interruptions to supply routes through the Red Sea.

In September 2022, in response to these challenges, the Kingdom collaborated with regional partners to launch a food security action plan with an initial funding of $10 billion.

The Yanbu Grain Handling Terminal will be operated by the National Grains Co., a joint venture between the national shipping carrier Bahri and the Saudi Agricultural and Livestock Investment Co.

It features a 650-meter conveyor belt and a discharge rate of 800 tonnes per hour directly from ships, with an annual handling capacity exceeding 3 million tonnes of grain.

According to Bahr’s statement to the Saudi Stock Exchange, the inauguration delay was caused by the inclusion of additional requirements to enhance future operational efficiency, along with the construction of extra infrastructure to accommodate potential future expansions.

The company said that because of this the total project cost rose by 7 percent from the initially allocated SR412.5 million ($109.7 million), though the increase is not deemed significant.

The Yanbu Grain Handling Terminal aims to become a world-class logistics hub, connecting three continents and supporting the Kingdom’s vision for a resilient and efficient agricultural supply chain.

Established in 2020 as a strategic partnership between SALIC and Bahri, the National Grain Co. aims to fulfill the Kingdom’s future feed grain requirements while enhancing its global competitiveness.

It is committed to advancing grain trade, handling, and storage through the Yanbu terminal, strengthening supply chains and ensuring price stability across Saudi Arabia.

SALIC, a Public Investment Fund-owned company, was formed in 2011 to secure food supply for Saudi Arabia through mass production and investment.

When the project was announced in 2020, Al-Fadli, who is also the chairman of SALIC’s board of directors, said: “The project aims to enhance the velocity of the main grain influx to Saudi Arabia and is considered the first regional center for grains in the commercial port of Yanbu.”

 

He added that SALIC relies on the geographical location of the Kingdom and the port infrastructure to enhance food distribution in the region by linking the Kingdom to global grain sources, especially countries where SALIC is investing.

 

A grain delivery service to customers within the Kingdom has been introduced as part of the project, ensuring greater proximity to clients, enhanced customer experience, and improved profitability margins.

Topics: food security Yanbu Grain Terminal grain Yanbu Saudi Arabia

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UAE’s ADNOC boosts drilling capabilities with 2 new jack-up rigs

Updated 23 December 2024
MOHAMMED AL-KINANI
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UAE’s ADNOC boosts drilling capabilities with 2 new jack-up rigs

  • ADNOC Drilling will expand its fleet to 142 platforms
  • UAE possesses the sixth-largest crude oil reserves globally
Updated 23 December 2024
MOHAMMED AL-KINANI

JEDDAH: The Abu Dhabi National Oil Co. has received two new jack-up rigs, reinforcing its position as one of the largest drillship fleet owners globally.

ADNOC Drilling will launch the new rigs by the first quarter of next year, expanding its fleet to 142 platforms. This marks a strong year for the company, showcasing its performance and strategy, according to UAE state news agency WAM.

For over 50 years, ADNOC Drilling has been the exclusive provider of drilling and rig-related services to ADNOC Group under agreed contractual terms, supporting the firm’s upstream operations in exploring and developing oil and gas resources in the UAE.

With most of the Gulf country’s crude oil and gas reserves located in Abu Dhabi, ADNOC oversees the majority of nationwide exploration, appraisal, development, and production activities, which are managed by ADNOC, either independently or in partnership with third parties.

In its analysis of the company’s performance, JPMorgan, a global financial services firm, said: “Since its initial public offering, ADNOC Drilling has proven to be a high-quality, defensive business, consistently meeting and surpassing guidance and expectations. The exceptional performance also reflects positive progress with ADNOC Drilling’s two joint ventures.”

The UAE possesses the sixth-largest crude oil reserves globally, with approximately 107 billion stock tank barrels of proven oil reserves. Since its inception in 1972, ADNOC Drilling has played a crucial role in enabling ADNOC to unlock the country’s oil and gas resources efficiently and reliably, contributing to the nation’s energy sector.

This year, Enersol, a joint venture between Alpha Dhabi Holding and ADNOC Drilling, acquired four oilfield services technology companies, while Turnwell, another business partnership between ADNOC, SLB, and Patterson-UTI, set a record for initial well delivery time, accelerating the development of the UAE’s unconventional energy reserves.

Following its second upward guidance revision this year alongside its third-quarter results, ADNOC Drilling is on track to deliver its best-ever performance in Q4. ADNOC Drilling anticipates at least mid-single-digit expansion as it scales operations, according to WAM.

ADNOC forecasts a rise in drilling activity in the coming years, driven by its commitment to increasing crude oil production capacity by 25 percent, reaching five million barrels per day by 2027.

As the company looks to expand beyond the UAE and explore opportunities in the region, it foresees a growing need to expand its rig fleet to support its strategic growth plans.

The energy giant believes that expanding its rig fleet will enhance its current capabilities in rig hire, drilling, completion services, and associated operations and enable the company to offer unconventional drilling and biogenic well services. This expansion is expected to contribute to increased revenue and profitability.

Topics: ADNOC Abu Dhabi National Oil Co. (ADNOC) oil and gas UAE ADNOC Drilling

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Terminal 4 at Cairo International Airport to boost Egypt’s aviation and tourism sectors

Updated 23 December 2024
 MIGUEL HADCHITY
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Terminal 4 at Cairo International Airport to boost Egypt’s aviation and tourism sectors

  • Project is expected to bolster the country’s tourism goals and improve traveler experiences
  • Egypt’s aviation sector also improved 36 spots to 27th in the 2024 edition of the Air Transport Infrastructure Index
Updated 23 December 2024
 MIGUEL HADCHITY

RIYADH: Egypt is advancing its aviation sector with the ongoing development of Terminal 4 at Cairo International Airport, set to accommodate 30 million passengers annually.

According to a statement from the Cabinet, the “New Republic Air Gateway” project is expected to bolster the country’s tourism goals, improve traveler experiences, and position Egypt as an international aviation hub.

This year, the government announced plans to involve the private sector in airport management, including a global tender for Cairo International.

Egypt’s aviation sector also improved 36 spots to 27th in the 2024 edition of the Air Transport Infrastructure Index, aligning with Vision 2030’s focus on sustainable development, innovation, and global competitiveness.

Prime Minister Mostafa Madbouly, during a meeting at the New Administrative Capital, reviewed progress on the project alongside Minister of Civil Aviation Sameh El-Hefny. The session focused on the terminal’s specifications, implementation strategy, and potential to reshape the African nation’s aviation and tourism landscapes.

“Airport development works come within the framework of presidential directives to upgrade the Egyptian airport system, raise its capacity and improve the level of services provided to passengers,” he said.

At the meeting, Madbouly emphasized the importance of creating world-class facilities to accommodate rising traveler numbers. 

El-Hefny outlined the project’s phased execution, with completion expected within four to five years. He also revealed that negotiations are underway with international firms specializing in airport construction and management to ensure world-class execution. 

The minister emphasized the cutting-edge features of the new terminal, including its ability to initially handle 30 million passengers annually, with expansion potential to 40 million. 

In September 2023, Cairo Airport Co. partnered with Pangiam, a trade and travel technology company, and signed two agreements to develop the new terminal. These deals, focused on enhancing the airport’s operations with advanced technology, include a feasibility study to incorporate emerging technologies and deliver a seamless travel experience.

The terminal will feature a state-of-the-art runway equipped with advanced navigation and lighting technologies that meet international standards. 

Once operational, Terminal 4 is expected to elevate Cairo International Airport’s global status, making it a hub for regional and international travel. 

Topics: Cairo International Airport Egypt

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